Michael J. Rosen

Michael J. Rosen is President of ML Innovations, Inc., a fundraising and marketing consulting firm serving nonprofit organizations and the companies that assist them. An AFP Certified Master Trainer and winner of the prestigious AFP/Skystone Prize for Research, Michael is the author of the bestselling book "Donor-Centered Planned Gift Marketing."

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Does U.S. Really Need More Nonprofits?

Well, that’s what’s implied by the headline from a provocative op-ed piece in The Chronicle of Philanthropy last month. The article was written by Mark Rosenman, Director of Caring to Change, a project that seeks to improve how grant making serves the public. Rosenman was reacting to a study by Civic Ventures that found that more than 12 million Americans from 44 to 70 years old would like to start nonprofits or businesses that solve social problems. The article has received a great deal of attention at The Chronicle’s website and in a number of Groups at LinkedIn.

Unfortunately, Rosenman misses the major point of the study.

Unlike Rosenman, I find it exciting that 12 million citizens want to create socially responsible nonprofit organizations or businesses. This spirit of optimism, entrepreneurialism, and civic engagement should be applauded. Instead, Rosenman chastises these noble Americans for being “ill-advised and [having] self-centered ambition….”

The creation of nonprofit organizations and socially-responsible businesses is inherently democratic. By contrast, Rosenman’s call is, at best elitist. I am always gravely suspicious when someone in the establishment wants to shut the door to fresh, independent thinking and new organizations.

I reached out to Rosenman privately via his Caring to Change website. I haven’t received a response. Is Rosenman too elitist to answer some specific questions from someone who disagrees with much of what he has written? Perhaps. However, I’ll give him the benefit of the doubt and chalk up the lack of response to a technology glitch or simple oversight.

My first question for Rosenman was: Are you opposed to the creation of any new nonprofit organizations or just millions of them? How many new nonprofit organizations would be “safe” to create over the next five or 10 years? The headline from his op-ed piece implies he’s opposed to the creation of any new nonprofit organizations. If that’s not the case, he certainly has not stated how many new organizations he would deem acceptable.

Rosenman also failed to respond to my second question: I noticed that the Caring to Change project received funding from at least two “new” nonprofits, foundations created in the 1990s. For someone who speaks out against the creation of new nonprofits, is that not a bit hypocritical? Since I have no response from Rosenman, I’ll answer the question myself: YES!

As for Rosenman’s own questions, which he posed in his article, they are not particularly constructive. He asked, “…why do boomer entrepreneurs seem to think that starting millions of brand-new entities is the most effective way to make a societal contribution?” He also asked, “Why can’t they work through existing organizations to start their creative new programs, improve existing ones, or concentrate resources instead of multiplying administrative and overhead costs?”

Perhaps, as with my own unsuccessful attempt to connect with Rosenman, Boomers have similarly found existing nonprofit organizations unwilling to engage.

Here are some questions that I think are far more constructive:

Why do so many Boomers feel that existing nonprofit organizations are incapable or unwilling to meet the societal needs that they see?

Why do so many Boomers think that the only solutions to the problems they’ve identified are to create new organizations rather than engage with existing ones?

Why would so many Boomers express an interest in putting in the extraordinary effort to start an organization from scratch instead of working with an existing organization?

How many of the 12 million Boomers in question are actually likely to follow through?

Is there a need for their efforts?

Will this wave of socially responsible entrepreneurialism spark an overall increase in philanthropy or will it simply take money away from existing organizations?

How can existing organizations tap into and leverage Boomer enthusiasm?

How can existing organizations best engage Boomers?

Are existing nonprofit organizations willing to embrace change?

Rosenman’s questions were limited and establishment focused. My questions are largely Boomer focused. Where I do not focus on Boomers, I ask questions about the role of the sector. As a sector, we need to be donor centered. We’ll only get to the right answers if we ask the correct questions. And, the best questions will always be focused on donors and other supporters rather than on preserving existing organizations.

To be fair to Rosenman, I will agree that Boomers should make an effort to work within existing structures, act collaboratively, and avoid inefficient duplication of effort. However, where no other organization exists with the same mission and where collaboration is not practical for whatever reason, I encourage Boomers to march boldly forward. Competition can be good. Fresh perspective and energy can be good. Innovative solutions that run counter to the establishment can be good. I applaud the proactive citizenship of Boomers.

So, does the U.S. really need more nonprofits? Yes, if they’re the right ones.

16 Comments to “Does U.S. Really Need More Nonprofits?”

Michael, clearly Boomers have the potential to play a pivotal role in the social sector over the next 20 years. I wonder who is preparing for, what could be, a huge increase in well-educated and social-minded volunteers? I know several Boomers considering retirement in the private sector and looking to stay active and improve the communities they value. What an opportunity for existing organizations to leverage common values between volunteers and themselves. Thanks, as always, for thinking big.

Joseph, thank you for your comment. You are quite correct. For Boomers, retirement does not mean just sitting in a rocking chair on the front porch. Many want to remain active and want to contribute more than just money to improve their communities and the world. They want to give themselves. Smart nonprofit organizations will work to engage this population in innovative ways.

Meredith, thank you for your comment. I agree that the key issue is how do we as a sector harness the energy of Baby Boomers. Unfortunately, I think that’s a point that is lost in the original Rosenman op-ed piece. It’s up to the nonprofit sector to figure out how to engage and work with Boomers. It’s not just the responsibility of Boomers. Thank you for underscoring this point.

I think Rosenman has a point–do we really need new nonprofits? Do people who want to start their own nonprofits actually do research first to see if they can accomplish the same or more through an existing nonprofit? Or is it about them–“I’m such a great person. See–I started my own nonprofit.” Emphasis on “my own.” I suspect that much of it is about personal glory rather than service.

I have friends who volunteered to help with aid to tsunami victims in Asia in 2004. They said there were a plethora of nonprofits small and large running around the village they were posted to–all pursuing their own missions and none of them coordinated with each other. They described it as nefficient bordering on the ridiculous.

This sounded to me like a good argument for fewer, more effective and efficient nonprofits. Every time I see yet another person profiled in the news who has started his or her “own nonprofit,” I remember my friends’ report from the front lines and wonder.

Jean, thank you for sharing your thoughts. Sadly, it seems to me that you’re being a bit too cynical. While some nonprofit founders might be motivated by “personal glory,” I believe those cases are probably pretty rare. One reason “personal glory” is likely not a powerful motivator for starting a nonprofit is that there is precious little glory involved. Instead, it’s usually about a lot of work and little thanks. Instead, I believe that most new nonprofit organizations are started because their founders have a profound passion for the mission. Unlike the leaders of some establishment nonprofits who earn six or seven figure salaries, founders of nonprofit organizations are willing to work hard for little or no compensation because they believe passionately in the cause.

The rush to help can lead to inefficiency, unethical actions, and even criminal behavior as we’ve seen with the tsunami, the World Trade Center, Haiti, etc. Nevertheless, some new nonprofit organizations are doing superb work.

I know an American young woman in her twenties who traveled to Central America as a travel writer. She fell in love with one particular country and one village in particular. She saw a need for an arts education program that would a) extend the school day and keep kids safe while their parents worked, b) teach kids arts which, sadly, were not part of the school program for funding reasons, c) use the arts to build self-esteem in the children. She initially collaborated with an existing nonprofit organization. As the program grew, the head of the existing program became, let’s say, problematic. The only course of action was for the young woman to separate her arts program from the other established nonprofit. She did not do this for glory but to ensure that the program would continue to grow. Her new nonprofit is having a wonderful impact and has even captured the attention of the country’s president. Her project is being looked at as a model program. This young woman saw a need and simply stepped in to meet the need. She tried working with an existing charity but was ultimately forced to go independent to ensure survival of the project.

Nonprofit creators can be ethical, mission-driven, innovative, energetic, passionate, hard working, people. To suggest that all or most of these fine people are simply in it for themselves is off base. We should not let a few bad folks taint our impression of all new nonprofit creators.

“To suggest that all or most of these fine people are simply in it for themselves is off base. We should not let a few bad folks taint our impression of all new nonprofit creators.”

Of course not, and that’s not what I said. I said there can be a lack of efficiency and effectiveness out in the field when multiple nonprofits with overlapping missions aren’t coordinating their efforts. I didn’t call them nor do I consider them “bad folks.” But they may very well be cluttering the field. I think it just makes a lot of sense to see who is already out there doing good work before you assume that the world needs your particular nonprofit. It’s worth considering seriously whether or not you can serve more effectively through an existing nonprofit.

Jean, thank you for the clarification. It sounds like we’re in agreement. Those who are called to a mission really do need to carefully evaluate how best to move forward. And, existing nonprofit organizations need to be more welcoming. While I believe that most folks interested in starting a new nonprofit are well intentioned, I also recognize that not everyone is. In September, I did a blog piece about the exploitation surrounding the attacks on 9/11: “It’s the 10th Anniversary of the 9/11 Tragedy … Who Cares?”

Michael, a great reflective piece for both existing organizations and individuals who want to make a difference in the second half of life.

This discussion points out the need for engagement with people. Maybe there are some people who don’t want to engage with current organizations because they “feel” too institutional to them. I think your donor centered questions would be a good exercise for organizations as part of board and staff gatherings.

At the same time individuals who want to make a difference should explore working with existing groups to leverage existing infrastructure that has been created and already been paid for, learn best practices (don’t reinvent the wheel), and might enable a great idea or passionate energy to produce much quicker results for the benefits of all.

Of course, if a person is called to do something important and no other organization is doing it effectively–then by all means create a new organization and plant the seeds of new hope.

Richard, thanks for your comments. Anyone who feels called to a particular mission should carefully evaluate the best way to fulfill that mission. That may mean working through an existing organization or starting a new one. And, if starting a new organization, it may mean operating in collaboration with other organizations or working independently.

If existing nonprofit organizations want to harness Boomer enthusiasm and support, they need to develop a plan for doing so beginning by asking the right questions, as you’ve agreed. Sadly, many established nonprofit organizations are not welcoming to newcomers. Some are even downright hostile to fresh ideas.

Generally, though, I’m encouraged by the potential that exists for our society.

My brother approached me about starting a non-profit; as someone who works in development, I immediately saw the overhead, administrative responsibilities, and “wastefulness” of the enterprise. I was quite sure that there must be an organization somewhere that would fit the bill.

After extensive searching, I found many, many organizations that had pieces of my brother’s vision, but none that really seemed to get the whole point. Some used his proposed methodology but restricted their constituency unnecessarily. Others worked with the breadth of constituents that he wanted to serve, but were utilizing outdated and problematic methodology. In short, no one was serving in the way he was dreaming.

I have continued to suggest that he pursue a partnership with a fiscal sponsorship with an established organization, but that is proving difficult. Larger organizations seem to be too inflexible, smaller organizations already are short on resources and feel that it is a distraction from their mission.

Perhaps more non-profits willing to share infrastructure would provide an efficient framework for Boomers to build the types of programs that interest them. A “community foundation” non-profit focused on oversight, mentoring, and monitoring of smaller start-ups might prove to be the boon to innovation that community foundations have been to monetary giving.

Sam, thank you for sharing your comments and insights. All nonprofit organization, whether established, new, or planned, should consider opportunities for collaboration and avoid duplication of efforts. It should be about what will best meet the needs of the intended beneficiary market and not about the egos of those in power. Thank you for sharing the story about your brother and for your interesting idea of a nonprofit incubator-type structure.

Certainly we need more nonprofits, especially those efficiently impacting public good, as defined, not by any of us, elitist, cynical or optimist, but by the sector of the society benefitted.

The idea that the current set of nonprofits is enough is silly. Nonprofits are continuously formed and disbanded. Some hang on too long; some are incredibly inefficient and should merge or go out of business, although others are remarkably efficent and effective and should grow.
To deny any cohort the opportunity to test ideas out in the nonprofit sector is to blunt our overall effectiveness.

Maybe there currently are too many nonprofits out there, although that is a very different question.

Maybe these new, Boomer-created ones will replace the staid, old crowd that may be living on borrowed time.
The Boomers are just turning 65, and the average age span now at 78-80; We have enormous social capital and energy that is welcome in the sector.

James, thanks for sharing your thoughts. I particularly appreciated that you pointed out that established nonprofits should not exist simply because they exist. While new nonprofit ventures should justify their existence so, too, should established organizations. I’ve certainly seen nonprofit organizations that have outlived their usefullness, fallen into mission drift, or run inefficiently. Why should those organizations exist instead of being replaced my new, well-run nonprofits? Yes, we want to avoid unnecesaary duplication of effort. But, like you, I’m in favor of an infusion of fresh energy.

NPOs should be relevant for sure, and outliving their usefulness has to be seen as a good thing (since theoretically, the motivating force behind the NPO no longer exists?). Outliving usefulness means revitalizing and refreshing mission and purpose.

I am on the same page as Sam. I often wonder if there is a value to watering down the pool by increasing the number of nonprofits, or whether it would not increase the value of nonprofits more if they were able to expand in terms of reach, programming, service, relevance, etc. Now more than ever, it seems that some NPOs are striving for a niche market. There are a lot of NPOs already competing for dollars (and sometimes constituents). It has always seemed to me that NPOs (particularly smaller, grassroots orgs) would do well to develop strategic alliances with like organizations across state/provincial/other borders, pooling resources to launch campaigns that raise awareness, and leveraging that at a more local level to drive funding and expand reach/programmes/services to impact more people.

Sue, thank you for your comment. I agree that collaboration can be a powerful strategy for nonprofit organizations. Many years ago, Pew even provided funding for projects by Philadelphia-based nonprofits that involved collaboration. Some of the projects were a bit silly or involved collaboration in name only and did not survive once the funding went away. However, other projects were indeed meaningful. Nonprofit leaders, of both new and established organizations, should routinely ask, “How can we best fulfill our mission and deliver maximum benefits to those we serve?” If organization leaders do this in an honest way, we’ll see more collaboration, mergers, etc.